Tan Kin Lian's Blog: Twisting of Life Insurance Policies

Sunday, February 07, 2010

Twisting of Life Insurance Policies

Twisting occurs when an insurance agent ask the consumer to give up an existing life insurance policy to buy a new policy by stating that the new policy has some useful features. This is usually misleading and bad for the customer. It has been a rampant practice in many countries, including Singapore, for many years. By switching insurance, the consumer has to incur the upfront cost (of two years premium) again. This is how insurance agents continue to make a big income at the expense of the consumers.

Many consumers are not aware that they are being skimmed. Those who are, felt embarrassed and prefer to overlook it, rather than bring the agent to account. This is how the bad practice has continued for so long.

If consumers allow this type of practice to continue, they will have very poor return on their hard earned savings that they put into life insurance. They will not get a fair return. What a pity!

Tan Kin Lian

5 comments:

Anonymous said...: ntuc agents especially the top agents have been asking their policyholders to twist their old wholelife with their new vivolife.
Their modus operandi is vivolife need to pay for 10 years and you are covered for life. This is not true. You don't stop paying. Your cash value is still paying for life and that is guaranteed income for the company for life too. This is a clever trick not told to policyholders.MAS must know about this . Someone from inside must blow the whistle to MAS and investigate the agents who twisted their policyholders' policies.; February 07, 2010 4:31 PM
Anonymous said...: In the first place, all the wholelife, endowment and regular ILP are already so high cost and give lousy value. With churning and twisting added in, this makes a hopeless case into a condemned case.

For those who have experienced this, you should report to MAS and complain to the compliance dept of the insurance company. Even if you don't get ideal outcome -- refund of premiums and re-instatement of old policy without any penalty -- if MAS receives enuf such complaints, they will need to act on it. Insurance companies and their agents will come under greater scrutiny and may prevent your family members, relatives or friends from becoming the next victim.; February 07, 2010 5:33 PM
Anonymous said...: Hope in your book you also warn consumers of twisting, churning and replacement of insurance policies.
Also hope you can highlight the dubious wards like MDRT, COT or TOT seen in insurance agents name cards that they are the marks of possible unethical and conflict of interest, to warn consumers to be extra careful about dealing with salesmen with such marks.; February 07, 2010 5:55 PM
Anonymous said...: I have heard of twisting or replacement or churning of an ingenious form in ntuc. Buy a revosave with cash backs and use the cash backs to pay for a vivolife. The unwary customers may think he or she is getting 2 policies but in actual fact it is destroying one and feed another one. The net effect is the agents get 2 commissions and the poor customers are no better off, at best and at worst he or she is paying more for less.Is it twisting , churning or replacement?
This is unscruple of the worst kind. I marvel at what insurance agents can come up with when the stake is commission.
What about the customers' interest?
They can take the back seat, lah.
If consumers have such experience I suggest you send it to MAS to deal with.; February 07, 2010 7:12 PM
Anonymous said...: If MAS is interested to know what actually going on in various companies and their agents this blog is a good place to gather info.
This blog might even serve as whistle blowing blog.
To start with MAS can work on the above postings; February 07, 2010 11:10 PM